EXHIBIT 10.4
Product Purchase Agreement
Between
@Road, Inc.
And
Novatel Wireless Technologies, Inc.
This agreement is made by @Road, Inc. and Novatel Wireless Technologies, Inc.
and is effective as of January 1, 2000. The terms and conditions contained in
this Agreement shall govern the production, purchase, warranty and support of
the product mentioned below as "Product". In the event of any conflict between
this Agreement and the terms and conditions of an order, as defined below, this
Agreement shall govern. Novatel Wireless Technologies, Inc shall be referred as
Novatel and @Road, Inc. shall be referred as @Road.
1.0 Product
1.1 Product supplied to @Road is Expedite CDPD 0.6- Watt radio modem. The
unit includes the communications board, top and bottom shield covers
and a 50-ohm RF connector for antenna connection.
1.2 Novatel may, at its discretion, implement changes in the Product,
modify the drawings and its specifications, or substitute a Product of
more recent design; provided, however, that any such changes,
modifications or substitutions, under normal and proper use shall not
materially and adversely affect functional performance, form or fit of
the product. Novatel agrees to provide @Road with 60 days written
notice of such changes.
2.0 Pricing
2.1 Novatel agrees to supply the Expedite CDPD modems, to @Road at a unit
price of US $99 during the entire term of this Agreement, which shall
run from January 1, 2000 to March 31, 2000.
2.2 The price is FOB Novatel's facility in Carlsbad, California. The price
includes normal packing for domestic and international shipments. All
duties, insurance, special packing costs and expenses, and all
Federal, Provincial, State and local excise, sales, use and other
similar taxes are for Customer's account and will appear as additional
items on invoices.
2.3 Novatel reserves the right to create additional FOB locations as
additional contract manufactures are selected.
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3.0 Forecast, Purchase Order and Liability
3.1 @Road has provided a 3-month purchase order to Novatel. The volume
required are:
January 2000 2000
February 2000 4000
March 2000 5000
3.2 Payments terms will be:
January volume full payment made in advance
February volume $250,000 30 days in advance and the remainder upon
delivery.
March volume $250,000 30 days in advance and the remainder upon
delivery.
3.3 If there is more than a 20% negative variance in the @Road purchase
order and quarter to date numbers, @Road will be responsible for
making payments of $30 per unit on the variance between the purchase
order and the actual consumption.
3.4 If there is more than a 20% negative variance in Novatel's ability to
ship vs. the quarter to date purchase orders, Novatel will be
responsible for making payments of $30 per unit on the variance
between the purchase orders and the actual shipments.
4.0 Warranty.
4.1 Warranties shall be defined in Schedule `A'
4.2 @Road will be responsible for sending units to Novatel's facility in
Carlsbad if warranty repairs are required. If product is determined to
be no fault found, @Road will be responsible for all freight costs to
and from Carlsbad.
5.0 Miscellaneous
5.1 This agreement cannot be assigned to a third party without the written
consent of @Road and Novatel.
5.2 All modems sold to @Road must be for internal consumption and cannot
be resold on the market.
5.3 @Road agrees to include the Novatel logo for @Road marketing
materials. This will be defined jointly by the two marketing
departments at a later date.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives.
Novatel Wireless Technologies, Inc. @Road, Inc.
/s/ Xxxxxx Xxxxx /s/ Xxxxx Xxxx
------------------------------- ----------------------------
Xxxxxx Xxxxx Xxxxx Xxxx
President and CEO President and CEO
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Schedule `A'
------------
1. Novatel Wireless warrants for a period of 1 year from delivery at the FCA
point that its Products are free from defects in material and workmanship,
conform to Novatel Wireless specifications and that the software shall be
free from errors which materially affect performance. THESE WARRANTIES ARE
EXPRESSLY IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING,
WITHOUT LIMITATION, ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
A PARTICULAR PURPOSE. NOVATEL WIRELESS SHALL IN NO EVENT BE LIABLE FOR
SPECIAL, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES, OF ANY KIND OR
NATURE DUE TO ANY CAUSE.
2. Novatel Wireless' obligations are limited to correction of such failure, by
implementation of the module swap warranty procedure whenever practicable and
are conditioned upon the Product having been maintained in accordance with
Novatel Wireless specifications and the Product not having been modified by
any party other than Novatel Wireless except as expressly permitted in
writing.
3. The foregoing warranties do not extend to (i) nonconformity's, defects or
errors in the Product due to accident, abuse, misuse or negligent use of the
Product or use in other than a normal and customary manner, environmental
conditions not conforming to Novatel Wireless' specifications, or failure to
follow prescribed operating maintenance procedures, (ii) defects, errors or
nonconformity's in the Product due to modifications, alterations, additions
or Product changes not made or authorized to be made by Novatel Wireless,
(iii) normal wear and tear, or (iv) damage caused by force of nature or act
of any third party.
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